If you've hired a builder to build a new home or renovate your existing home, it's almost a certainty that your builder is using at least some subcontractors to get the work done. Let's talk about what that means, what those implications are, and what you as a homeowner should know.
What is a subcontractor?
A subcontractor (Sub) is a company that is independent of your builder, meaning they can work for multiple builders or homeowners, and are generally paid by your builder as a 1099 (instead of a W2 employee). Subcontractors are usually specialists such as carpenters, electricians, or plumbers but can sometimes be involved in multiple trades.
Is it good or bad for my builder to hire subcontractors?
That's certainly going to depend on the quality of the sub. Specializing (most of the time) allows a sub to be more skilled at a specific task than a generalist/handyman, but that's the only skill they perform. They might be great at laying tile but aren't likely to fix the framing if it's bowed. I think the smaller the project (like a bathroom or kitchen renovation), the more bang for your buck you'll generally get out of a good generalist. Once you get into large additions and whole home construction or renovations, you definitely want crews who specialize because the costs start to even out and the quality should end up higher. If certain trades require a license (electrician, plumber, HVAC, etc), generalists will need to sub out that work as well.
What to know about my builder's subcontractors:
Subcontractors (at least in Georgia) are required to carry their own license and insurance. Your builder should have a Certificate of Insurance (COI) for each subcontractor in place before that sub starts work on your house (example). In Georgia, all are required to have General Liability insurance and any employer with at least 3 employees must also carry Workers Comp. A few things you might ask your builder regarding subcontractors:
How do you track your subcontractors' COIs?
How long have you worked with most of your subs and who are your newest ones? (generally the longer they've worked together, the better, although change is common enough)
How do you communicate your/my expectations in your project to newer subs?
Do you have them sign Lien Waivers before receiving payment?
Other Subcontractor FAQs:
Which subs are the hardest to find?
Honestly, all of them. Trades in general, especially good ones who care about their work, are getting harder to find because of the declining labor pool and lack of knowledge/training being passed down. Specifically though, the more specialized the trade, the harder to find. In Georgia, we don't do a lot of plaster (we're almost exclusively drywall), so that can be a tough one. Stucco is also becoming less popular here and more specialized, but that varies by region.
Do builders need backup crews?
Definitely. You generally have an "A Team" that is your go-to crew, but they might not be available or a good fit for a certain project, so you have backups that can get the job done but might require more hands-on management. There's also a chance that your A Team guy gets in a car accident, falls out of a tree, or dies of a heart attack (all three have happened to crews of mine) and then you're stuck trying to find someone new and lose all momentum on the project.
Which subcontractor is most likely to derail a job schedule?
Your friend who is "helping you out" on your project. Anyone who you aren't paying that is going to help you with the design, or do that one cool thing they did at their house, or whatever it might be is way more likely to slow you down than any one trade or subcontractor. Free work usually ends up free from accountability as well, so I always advise my clients against those relationships.
How do you manage subs across multiple jobs?
Treat them like equals and be incredibly organized. As a builder, you have to recognize that your subs are running a business trying to provide for their families and your job is not the only job they're working on. So you have to respect their time by giving them plenty of notice and making sure the job is ready for them when they show up, communicate with them if something changes, and help them problem solve in real time as things come up. You also need to manage your schedules so that you don't need the same sub on more than one of your jobs at the same time. If it's not pre-planned, then whoever's critical path would be affected the most is where that sub should go. Using a good construction management software that tracks your schedule is an incredibly helpful tool for these situations.
Subcontractors are an important part of the construction industry and, if managed well, can add a lot of value to your home building journey.